BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
DATED: 18/12/2009
CORAM
THE HONOURABLE MR.JUSTICE D.MURUGESAN
W.P(MD)No.4533 Of 2005
and
W.P.M.P(MD)No.4827 of 2005
W.V.M.P(MD)No.369 of 2005
M/s. Kanchanaa Hotels Private Limited,
represented by its Director,
50, Williams Road,
Tiruchirappalli.
..Petitioner
vs
1. The Chairman and Managing Director,
State Industries Promotion Corporation
of Tamil Nadu Limited,
19-A, Rukmani lakshmipathy Road,
Post Box No.7223, Egmore,
Chennai - 600 008.
2. The Deputy General Manager(F and R-I)
State Industries Promotion Corporation
of Tamil Nadu Limited,
19-A, Rukmani lakshmipathy Road,
Post Box No.7223, Egmore,
Chennai - 600 008. ..Respondents
PRAYER
Writ Petition filed under Article 226 of the Constitution of India,
praying to issue a Writ of Certiorarified Mandamus calling for the records
relation to the order passed by the first respondent in f and F-1/806/2005,
dated05.05.2005, quahs the same and to direct the first respondent to consider
the petitioner's representations, dated 14.3.2005 and 16.3.2005 and consequently
to consider and grant waiver of interest on interest and penal interest charged
on the petitioner's term loan being principal together with simple interest.
!For Petitioner ... Mr.J.Anand Kumar
for Mr.N.R.Elango
^For Respondents ... Mr.V.Ramalingam
:ORDER
The petitioner company through its Director, sought financial assistance
through SIPCOT, for construction of a hotel and availed a sum of Rs.135 lakhs on
15.02.1996 and an additional loan of Rs.60 lakhs on 07.04.98. The company could
not repay the amount in full. Therefore, a onetime settlement scheme was
arrived at. The SIPCOT by its communication, dated 11.04.2005 accepted for
onetime settlement, with a condition that the petitioner should pay 25% of the
onetime settlement within a period of 15 days from the date of communication of
the said letter and to pay the balance amount within a period of 90 days from
the date of the said letter. However, the petitioner instead of complying with
the above condition, has only requested for further time of three months for
settlement of dues. That was not accepted by the SIPCOT and by the impugned
communication, dated 05.05.2005, the petitioner was advised to pay only 25% of
OTS amount of Rs.138.02 lakhs on or before 23.05.2005, failing which, the OTS
proposal will be cancelled. The petitioner was also advised that the balance
amount to be paid within 90 days as informed in their letter, dated 11.04.2005.
This order is in question in this Writ Petition, mainly on the ground that
though the petitioner has requested the SIPCOT in their letter, dated 16.03.2005
to waive the interest on interest charged on the loan and the penal interest
charged so far in full, the same was not considered.
2. I have considered the submissions made by the learned counsel for the
petitioner and the learned counsel for the respondents.
3. It is now well settled law that this Court is not justified in issuing
a direction to the bank or the finacial institution for onetime settlement as
has been held by the Division Bench of this Court in Tamil Nadu Industrial
Invest Corporation Limited., represented by its Managing Director, No.473, Anna
Salai, Nandanam, Chennai – 600 035 .vs. Millenium Business Solutions Private
Limited, represented by its Managing Director, No.1/9, Padmam Flats, P.P.Rao
Road, Balaji Nagar, Royapettah, Chennai-14 and another reported in 2004 (5) CTC
689. That judgement of the Division Bench was followed subsequently in
W.P.No.19707 of 2005 by another Division Bench, dated 19.07.2005. Recently,
another Division Bench also followed the said judgment in W.P.No.12654 of 2009,
dated 03.12.2009.
4. That apart, when the advise for onetime settlement was mooted out, the
petitioner had only prayed for three months time and did not raise any dispute
as regards the quantum. Though the respondent SIPCOT did not agree for extension
of three months time, nevertheless, had given further advise to pay at least 25%
of the amount on or before 23.05.2005 and the balance amount in three months as
directed in letter, dated 11.04.2005. These orders have not been complied with
and any interference of the impugned order would amount to directing the
respondents to accept the onetime settlement, which this Court cannot do.
5. Hence, I find no merit to interfere with the order. Neveretheless, as
the petitioner has brought to the notice of this Court, a communication, dated
16.03.2005, seeking for waiver of interest on interest and the penal interest in
full, it is for the respondent bank to consider the same and in this regard, the
petitioner can approach the bank.
6. The Writ Petition is dismissed, with the above observations.
Consequently, connected Miscellaneous Petitions are dismissed. No costs.
vsn
To
1. The Chairman and Managing Director,
State Industries Promotion Corporation
of Tamil Nadu Limited,
19-A, Rukmani lakshmipathy Road,
Post Box No.7223, Egmore,
Chennai – 600 008.
2. The Deputy General Manager(F and R-I)
State Industries Promotion Corporation
of Tamil Nadu Limited,
19-A, Rukmani lakshmipathy Road,
Post Box No.7223, Egmore,
Chennai – 600 008.